Grayson Perry, artist, potter, writer, transvestite and all-round observer of modern life in contemporary Grecian urns, has been invited to curate a show at the British Museum. It would be hard to imagine a better choice. It is not just that Perry's works join the family of ancient objects like long-lost children, though that is striking in itself. It is that the past comes so brightly to life through his eyes.

Perry has made the 20-minute pilgrimage to the museum from his home hundreds of times. Knowledge counts. He winkles out the most mesmerising and arcane items from cupboards and shadowy corridors: a Congolese power figure, an Egyptian soul house, grave dollies, magic nails, their appearance as strange as their purpose.

Taken out of context and mixed up with Perry's works, they acquire new freedom and force. That figure of a man dragging his wife by the hair is not just a dusty old Haida totem but a sharp satire on English behaviour. The clod of Malian mud on legs has the raw power to alarm even now. You spot the bonnet improbably fashioned out of Samoan turtleshell and wonder if Perry made it himself, a historicised pastiche of his Bo-Peep get-up.

The affinities between old and new are at times so strong one starts to doubt the labels. Is this onyx cameo that looks so like the artist really Roman or did Perry carve it himself? The similarities between the ancient Tibetan helmet and the early English variation seem staggering, until one notices the motorbike motif concealed in the latter.

This incidental guessing game goes to the heart of the show – Perry is collapsing time through art. For what is really out of date here? Not the shrines, coins, reliquaries, embroideries, pilgrim badges and maps that reach backwards and forwards through the millenniums. You think we don't have portable shrines any more? Consider the photo albums on our mobile phones.

This is a journey round the artist's mind as well the world, featuring Perry's childhood teddy as proxy pilgrim. Alan Measles, who would defeat the Germans and protect young Grayson, pops up as talisman, badge, papal stamp, shaman and, best of all, on horseback, as a monument to our helpful imaginary friends. Our lives are profoundly bound up with objects.

Perry's humour enriches the whole experience, coupled with his superb insights into the minds of unknown craftsmen stretching back a million years. His exhilarating celebration of their art culminates with the show's pièce de resistance: a magnificent cast-iron ship stuffed to the gunwales with fragments of their work, surging forward in all its patinated glory towards the afterlife, carrying the small manmade wonders of the world.